TO AVERT STARVATION, LET’S USE THIS LOAN WELL

The potential impact of the proposed agro-industrialisation and agricultural transformation are enormous, writes Tommy Odemwingie

I crave the indulgence of using my perspectives from a mixture of primeval recollections and largely indubitable career experiences to comment on the very important subject of putting affordable food on the table for millions of Nigerians experiencing hunger and facing starvation.

I come from a farming community and a farming family. I witnessed how my father got fed up with faming in the late 1950s and instead enlisted in the labour force that cleared a sizable portion of the rain forests of Urhonigbe in the present Orhionmwon LGA of Edo State for the old Western Nigeria Development Company (WNDC) to establish arguably the biggest rubber estate in West Africa. The employ also took him to Ijebu-Ode (present Ogun State) and Araromi (Ondo). I suspect he was also involved in the paid labour that established the estates in Ewohimi (Edo) and Utagba-Uno (Delta) before he returned, quite probably grudgingly, to the old profession.

His disenchantment with farming had to with its non-viability beyond feeding the family, with product wastage on farms due to transportation challenges and perishing in markets due to the dearth of storage facilities. But with the earnings from itinerant paid labour, he was able to rescue his aged widow mother from the pangs of virtual homelessness. But after the spell of economic gallivanting, he returned home, but now had to join forces with his wives to run a family food and drinks business that enabled him rise above his peers who hadn’t taken the risks that he took.

Meanwhile, my mother had no choice other than continue with farming and its drudgery, which she augmented with the family’s non-agrarian business. But she did see a glimmer of hope and grabbed it. It came with the food shortage occasioned by the civil war. Her elder sister alerted her to a cassava farm for sale, which she bought, harvesting and processing the product into garri, which was in hot demand in the rebel-held territory, and she made significant profit. That’s how she bought a brand-new Raleigh bicycle (although she always bragged that “My husband bought it for me”!)    

I need also say that my perspective on the subject of food security has been enriched by two years as media and public relations consultant to the International Institute of Tropical Agriculture (IITA), Ibadan’s Information Services Programme then headed by Dr. Stephen L. Lawani, who later worked for the World Bank in Washington. In addition to media capacity building to increase public awareness of the wonderful research being generated by the institute, I also generated content that readily found outlets in the different channels.

As project documents go, the Special Agro-Industrial Processing Zones (SAPZ) Programme that was launched by Vice President Yemi Osinbajo, on behalf of Mr. President, on 24 October 2022, is an excellent piece of development intervention from the perspectives of agencies and institutions involved in its implementation. But cynics are wont to wonder what’s the big deal in projects documents that have all the elements of relevance, timeliness, copious details, lucidity, clarity and such other familiar assessment tools, or what cynics (there they go again?) would dismiss as a heap of cliché!

The only problem is that any document that doesn’t pander to any of these — and, indeed, several other – assessment criteria too long to list here, lest this analysis ends up being an academic excursion that it’s being deliberately veered from would end up a monumental failure.       

“Another loan?” That’s the predictable retort from cynics on the spectre of “incurring” another debt by a country already being suffocated in it.

Now, let me go back to some of my perspectives on development informed by my career experiences that qualify me to comment on this subject. In the early days of the regime of Ibrahim Babangida, when the man wanted to consolidate his popularity, he threw the issue of taking an IMF loan to the public to debate. I was, in addition to my duties as features editor of The Guardian, assigned the arduous task of selecting and editing the avalanche of contributions to the debate.

IMF was already a controversial (perhaps misunderstood) institution, anyway. Coupled with the negative connotation conjured by “loan”, “borrowing” (“borrow-borrow” (to put it classic Nigerian parlance) and “debt”, the overwhelming verdict of Nigerians was, predictably, a resounding NO to the IMF loan offer. The preference for Nigerians who had just survived scarcity of essential commodities (“Essenco”) was for belt-tightening. That’s how Nigeria, on the surface, rejected the loan, though, down the years, the nation would pile up debts to such of such magnitude that the Obasanjo administration made loan forgiveness a mission.

However, development economists don’t believe that taking loans is always necessarily a bad thing; rather, it is committing the funds to unviable ends and not respecting the conditionality attached to the borrowing that are bad, indeed that constitute a bad habit.

According to the International Fund for Agricultural Development (IFAD), “The loan is granted on blend terms, and shall be subject to interest on the principal amount outstanding and a service charge as determined by the Fund at the date of approval of the loan by the Executive Board. The interest rate and service charge determined will be fixed for the life cycle of the loan and payable semi-annually in the loan service payment currency, and shall have a maturity period of 25 years, including a grace period of five years starting from the date of approval of the loan by the Executive Board. The principal of the loan granted on blend terms will be repaid in equal installments.”  It lists the co-financier(s) of the programme as are African Development Bank (AfDB), Africa Growing Together Fund (AGTF), Islamic Development Bank (IsDB) and the Green Climate Fund (GCF).

The Nigeria Special Agro-Industrial Processing Zones (SAPZ) Program is a government-enabled and private sector-led initiative that seeks to mobilize private sector investment to develop value chains for selected strategic crops and livestock in the participating States. Nigeria will implement the first phase of the SAPZ program with co-financing from the African Development Bank, the International Fund for Agricultural Development (IFAD) and the Islamic Development Bank (IsDB). The total amount mobilized for Phase 1 is $538.05 million – African Development Bank is providing $210 million; the IFAD together with the Green Climate Fund, $160 million; IsDB, $150.52 million; from the Federal Government of Nigeria (FGN) $2.01 million and $16.01 million from the Participating States.

At the launch and announcement of the Nigeria SAPZ to key stakeholders — national and international partners, including co-financiers, development partners, the private sector, farmers groups, national networks, the diaspora population and other actors — of the programme on 24 October 2022, its leaders stated their objectives to include following:

·       To demonstrate political support at the highest levels of Federal and State governments in Nigeria, and the leadership of the key partners;

·       To attract private sector investment into the zones;

·       To raise public awareness of the Special Agro-Industrial Processing Zones Program;

·       To enhance understanding of the roles of key actors involved in the implementation process.

The event attracted high-level representation (some participating virtually), including Dr. Akinwumi A. Adesina, President of the African Development Bank Group (virtual); Dr. Alvaro Lario, President of IFAD and Dr. Muhammad Al Jasser, President of the Islamic Development Bank, or their representatives. Also on the federal government’s team were the Minister of Finance, Budget & National Planning; Minister of Agriculture and Rural Development, Minister of Industry, Trade and Investment; and Minister of Water Resources. Attendance from the participating States included the Governors for the seven Phase 1 states, namely, Kaduna, Kano, Kwara, Oyo, Ogun, Imo and Cross River State, and the Minister of the Federal Capital Territory. National high-level representation included key partners, including the MD/CEO, the Bank of Industry; MD/CEO, Nigeria Sovereign Investment Authority; and the MD, Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL). The event also attracted private sector anchor investors and logistic companies interested in the Nigeria Special Agro-Industrial Processing Zones Program.

The Special Agro-Industrial Processing Zones program is a flagship of the African Development Bank under its Feed Africa Strategy. The objective is to extend economic infrastructure to rural areas of high agricultural potential, attract investment from private agro-industrialists and entrepreneurs, and contribute to rural communities’ economic and social development. 

The zones will enable farmers (including livestock keepers), agricultural producers, processors, aggregators, and distributors to work together in one location, lowering transaction costs and sharing business development services to boost productivity and competitiveness.

The first phase of the Nigeria SAPZ Program will be implemented with co-financing from key development partners. The total amount mobilized for the project is $538.05 million. In addition to the African Development Bank funding of $210 million, the Islamic Development Bank and the International Fund for Agricultural Development will provide parallel co-financing of a combined $310 million.  The government of Nigeria will contribute $18.05 million 

The potential impact of the proposed agro-industrialization and agricultural transformation are enormous.

For the programme to succeed, its implementors need to be aware of the following success factors:

·       Investors need to go for appropriate technologies to add value to agricultural produce;

·       Recognizing the fact that productivity has always been hampered by farmers’ reliance on traditional varieties that are not resistant to disease, pests and drought, investors should empower farmers to use improved varieties;

·       Investors should strengthen the capacity of farmers to minimize use of cultural methods to try to control spread of crop diseases, to instead invest in scientific solutions, as with the Banana Bacterial Wilt project, which developed bacterial wilt resistant bananas for use by smallholder farmers in the Great Lakes region. In 2004, IITA and NARO scientists started developing transgenic bananas resistant to BXW in a joint project funded by Gatsby Charitable Foundation. IITA and NARO were responsible for developing, transformation and evaluating transgenic bananas for resistance to BXW;

·       To obviate the drudgery that makes agriculture and food processing unattractive, the programme should encourage investment in mechanization. For example, cassava, a highly nutritious crop, can be time-consuming to plant, maintain and harvest. This has caused many farmers to shun planting the crop and those who plant cassava neglect its maintenance leading to below optimum yields. Cassava Mechanization and Agroprocessing Project (CAMAP), currently being implemented in Nigeria, Zambia and Uganda by the African Agricultural Technology Foundation (AATF), a Non-Governmental Organisation through the Cassava Mechanization and Agro-processing Project (CAMAP), with the support of United Kingdom Agency for International Development (UKAID), is aimed at reducing drudgery, and increasing productivity and incomes for farmers;

·       States participating in the programme should create a fully enabling environment for its implementation, through supportive legislation, including appropriation, security for investors and non-interference in the recruitment of personnel.

If the boxes for these factors were ticked, my father, who had a reputation for hard work, would have found company in the pantheon of great farmers from Benin land, instead of just being known by the reputations of his children and grandchildren, including three journalists, a medical doctor, a chartered accountant, a diplomat and an oil industry executive, among others.

And, who knows, if the boxes are ticked, through the Nigeria SAPZ Program, when Edo becomes a Participating State, big-time investors in farming and agro-industrial businesses will yet emerge from my family to take the man’s rightful place in the pantheon!

o   Odemwingie, who studied Rural Social Development at the University of Reading, UK, is a former features editor of the Guardian and one-time consultant to the International Institute of Tropical Agriculture (IITA), Ibadan, Nigeria. He is the initiator of Outgrow Hunger Nigeria campaign.